Cabinet clears ₹9,585 crore scheme to scrap old trucks, buses in Delhi-NCR
Synopsis
The Modi Cabinet's ₹9,585 crore bet on cleaner trucks and buses is the most concrete fleet-turnover push Delhi-NCR has seen. With 2.07 lakh commercial vehicles in scope, 5 per cent interest subvention, fuel vouchers, and OEM discounts stacked together, the scheme finally pairs scrappage mandates with a credible incentive ladder — though execution across four states will decide whether NCR's winter air actually breathes easier.
Key Takeaways
Union Cabinet approved a ₹9,585 crore two-year scheme on 3 June for Delhi-NCR fleet turnover.
Centre's share is ₹5,041 crore ; states to extend ₹1,601 crore in tax concessions.
Around 2.07 lakh vehicle owners — 1.91 lakh trucks and 16,329 buses — are eligible.
Incentives include 5% interest subvention, fuel vouchers up to ₹4,800 /month, and 8% OEM discounts.
States to waive up to 100% motor vehicle tax on new vehicles for 10 years .
In Delhi, new LGVs must be electric; buses must be BS-VI CNG or electric.
The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday, 3 June, approved a two-year scheme with a total outlay of ₹9,585 crore to replace ageing BS-IV and older trucks and buses across the Delhi-NCR region with BS-VI-compliant or electric vehicles. The move is aimed at curbing vehicular emissions in one of the world's most polluted urban clusters and is projected to benefit nearly 2.07 lakh commercial vehicle owners.
How the funding is structured
Of the total outlay, ₹5,041 crore will come from the Centre, with an estimated ₹1,601 crore in tax concessions extended by participating states, according to an official statement. The scheme will be funded through the National Capital Region Planning Board (NCRPB) under the Ministry of Housing and Urban Affairs and implemented jointly by the Ministry of Road Transport and Highways and the Ministry of Petroleum and Natural Gas, in collaboration with Delhi, Haryana, Rajasthan, and Uttar Pradesh.
Who benefits and what's mandatory
The scheme covers an estimated 1.91 lakh trucks and 16,329 buses registered in Delhi-NCR. For BS-III or older vehicles, scrapping at Registered Vehicle Scrapping Facilities is mandatory. BS-IV vehicles may either be scrapped or sold outside NCR in non-NCAP cities. Owners must subsequently register a BS-VI-compliant or electric vehicle within NCR. In Delhi, Light Goods Vehicles purchased under the scheme must be electric, while buses must be either BS-VI CNG or electric. Government vehicles are excluded.
The incentive stack
The Centre will offer a 5 per cent interest subvention on loans for five years, monthly fuel vouchers worth up to ₹4,800 depending on vehicle category, and lump-sum benefits for EV purchases or Certificate of Deposit trading. State governments will waive registration fees and grant up to 100 per cent motor vehicle tax concessions on new vehicles and 50 per cent on used vehicles for 10 years, alongside waiving pending liabilities on the old vehicles. Participating auto OEMs will offer an 8 per cent discount on ex-showroom prices.
Digital delivery and timeline
Implementation will be fully digital through an integrated portal enabling real-time eligibility checks, automated subvention claims, monthly fuel voucher credits, and monitoring of pollution outcomes. Central benefits will continue for five years from the date of registration of the new vehicle, ensuring impact beyond the two-year enrolment window.
Why it matters
Air pollution in Delhi-NCR remains a severe public health challenge, particularly during winter, when freight diesel emissions compound stubble-burning smoke. Older commercial vehicles are a disproportionate contributor to PM2.5 loads. The scheme is the most structured fleet-turnover push tied to NCR airshed planning to date.
Point of View
GRAP-linked diesel bans, EV procurement targets — with mixed results. What's different here is the financial stack: interest subvention, fuel vouchers, OEM discounts, and state tax waivers layered onto a digital portal that ties benefits to verified scrappage. The weak link remains coordination across four state governments and the BS-IV resale loophole, which allows trucks to migrate to non-NCAP towns — exporting the pollution rather than eliminating it. Without parallel tightening of inter-state movement rules, NCR's gains could be the rest of the Indo-Gangetic plain's loss.
NationPress
6 Aug 2026
Frequently Asked Questions
What is the ₹9,585 crore Delhi-NCR vehicle replacement scheme?
It is a two-year scheme approved by the Union Cabinet on 3 June to incentivise owners of BS-IV or older trucks and buses registered in Delhi-NCR to replace them with BS-VI-compliant or electric vehicles. The total outlay includes ₹5,041 crore from the Centre and ₹1,601 crore in tax concessions from participating states.
Who is eligible under the scheme?
Approximately 2.07 lakh commercial vehicle owners across Delhi, Haryana, Rajasthan, and Uttar Pradesh — comprising 1.91 lakh trucks and 16,329 buses — are eligible. Government vehicles are excluded.
What incentives does the scheme offer?
The Centre will provide a 5 per cent interest subvention on loans for five years and monthly fuel vouchers worth up to ₹4,800. States will waive registration fees and grant up to 100 per cent motor vehicle tax concessions on new vehicles for 10 years, while participating OEMs will offer 8 per cent discounts on ex-showroom prices.
Are old vehicles required to be scrapped?
BS-III and older vehicles must mandatorily be scrapped at Registered Vehicle Scrapping Facilities. BS-IV vehicles may either be scrapped or sold outside NCR in non-NCAP cities, after which owners must purchase a BS-VI-compliant or electric vehicle within NCR.
What are the special rules for Delhi?
In Delhi, Light Goods Vehicles purchased under the scheme must be electric, while buses must run on either BS-VI CNG or electric powertrains. No BS-VI diesel buses qualify within the capital.
